Stageman v St John Ambulance Association in Western Australia Incorporated

[2010] WASC 203

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   STAGEMAN -v- ST JOHN AMBULANCE ASSOCIATION IN WESTERN AUSTRALIA INCORPORATED [2010] WASC 203

CORAM:   HALL J

HEARD:   23 JULY 2010

DELIVERED          :   23 JULY 2010

FILE NO/S:   CIV 2122 of 2010

BETWEEN:   JENNIFER ANNE STAGEMAN

Plaintiff

AND

ST JOHN AMBULANCE ASSOCIATION IN WESTERN AUSTRALIA INCORPORATED
First Defendant

LUCIANO MARCELLI
Second Defendant

Catchwords:

Interlocutory injunction - Serious question to be tried - Whether breach of lease - Identity of lessee - Whether lessee should be put back in possession - Balance of convenience

Legislation:

Property Law Act 1969 (WA), s 81
Rules of the Supreme Court 1971 (WA), O 37 r 6

Result:

Application for interlocutory injunction granted

Category:    B

Representation:

Counsel:

Plaintiff:     Mr S K Shepherd

First Defendant              :     Mr D J Branford

Second Defendant         :     In person

Solicitors:

Plaintiff:     Verschuer Edward

First Defendant              :     Kott Gunning

Second Defendant         :     In person

Case(s) referred to in judgment(s):

AG Australia Holdings v Burton (2002) 58 NSWLR 464

Australian Broadcasting Corporation v O'Neill (2006) 227 CLR 57

Automasters Australia Pty Ltd v Bruness Pty Ltd [1999] WASC 39

Beswick v Alner [1926] VLR 72

Cash Converters Pty Ltd v Hila Pty Ltd (1993) 9 WAR 471

Castlemaine Tooheys Ltd v State of South Australia (1986) 161 CLR 148

GWK Ltd v Dunlop Rubber Co Ltd (1926) 42 TLR 376

McHale v Watson (1964) 111 CLR 384

Plenty v Dillon (1991) 171 CLR 635

Wilson v Lombank Ltd [1963] 1 WLR 1294

HALL J:  (This judgment was delivered extemporaneously on 23 July 2010 and is edited from the transcript).

Introduction

1. This is an application for an interlocutory injunction.  The plaintiff, Ms Jennifer Stageman, seeks orders that she be returned to possession of commercial premises in Toodyay from which she has conducted a real estate agency business.  She claims to have been unlawfully evicted from those premises.

2. The first defendant, St John Ambulance Association of WA (Inc), is the owner of the premises.  The second defendant, Mr Luciano Marcelli, is the managing agent retained by the first defendant in respect of the premises.  Ms Stageman claims that Mr Marcelli took possession of personal property belonging to her (or which she had a right to hold) at the time of the eviction.  She claims that this included confidential information in regard to her business. She seeks orders that Mr Marcelli disclose on affidavit any access he has had to the personal property or the information, and that he return any copies or reproductions of the information.

3. In support of the application, affidavits have been sworn by Ms Stageman, dated 22 July 2010, and her solicitor, Ms Edward, dated 23 July 2010. The affidavit of Ms Stageman contains some hearsay, but that is permissible in proceedings such as this, subject to the deponent stating that she has the relevant information from an identified source and believes it to be true: O 37 r 6.

Facts

1. On the basis of the affidavits, the following facts are established for the purposes of this application.  On 16 December 2009, Ms Stageman signed a lease of premises at 120C Stirling Terrace, Toodyay.  The lease term was for 24 months, with rent payable monthly in advance on the first day of each calendar month.  Ms Stageman deposes that all due rent up to and including the current month has been paid.

2. On 29 June 2010, a letter was received by Ms Stageman from Mr Marcelli, advising that his real estate agency, Country Realty Pty Ltd, had been appointed by the owner as the managing agent.  The letter stated that the June rent was outstanding.  Ms Stageman refutes this, saying that the June rent had been paid direct to the owner as had been the practice prior to the appointment of Country Realty.  In any event, little seems to turn on this as, if there was any default in this regard, it was not relied upon subsequently.

3. On 12 July 2010, Mr Marcelli wrote a further letter to Ms Stageman.  Ms Stageman deposes that she did not receive it until 13 July 2010, or at least did not read it until that day.  The letter refers to an earlier letter of 8 July 2010, which Ms Stageman says she did not receive.  The letter of 12 July is addressed to Ms Stageman, care of 'Devenish 1897 Pty Ltd (in liq)', and on the apparent basis that that company was the lessee.  Whether or not Devenish was the lessee is a matter of dispute.  I will return to that issue later.

4. The letter asserted that Devenish as tenant was being wound up, and that discussions with a Mr Max Healy had established that he was now the proprietor of the business being run from the premises.  The letter went on to say that Mr Healy had no lawful basis for possession and that the landlord had given instructions to repossess the property immediately.

5. Ms Stageman refutes the contents of that letter.  She says that Mr Healy, who is engaged as the manager of her second office at Bindoon, was not trading as 'Realty Trend Toodyay' from the premises as alleged.  She says that Mr Healy has informed her that he did not tell Mr Marcelli that he was so trading.  She says she telephoned Mr Marcelli on 13 July 2010, and told him that she, and not either Devenish or Mr Healy, was the proprietor of the business and that she had a valid lease and would not be vacating.

6. On 14 July 2010, Ms Stageman arrived at the premises, to find that the locks had been changed.  Believing she had a lawful right to possession under the lease, she obtained entry with the assistance of a locksmith.  She then engaged solicitors.  There was correspondence between the solicitors in regards to whether the eviction was lawful.

7. Ms Stageman opened the premises for business on 15 July 2010, but sometime after closing on that day, and before 9.00 am the following morning, the locks were changed again.  Mr Marcelli, it would seem, obtained entry and removed all of the property on the premises.  This included computers and file records relating to the business.  Mr Marcelli has conceded that the property was then transported to a security firm in Northam.

8. Notices had been placed in the windows of the premises, which stated that Devenish 1897 Pty Ltd trading as Realty Trend was under external administration and that a liquidator had been appointed to wind up the company.  Inquiries were directed to a named administrator in Belmont.

9. Ms Stageman deposes that she had formerly been a director of Devenish, and that that company had previously traded as Realty Trend.  However, she says that the company had never been the lessee of the premises and that Devenish is in voluntary administration.

The lease

1. The lease does not refer to Devenish by name at all.  The lessee is nominated as 'Realty Trend ‑ Jennifer Stageman'.  The signature clause refers to Ms Stageman and is signed by her.  There is nothing to suggest she is signing in anything other than a personal capacity.  Indeed the section available for signing and sealing by a corporate lessee had been struck out and initialled and marked with the initials N/A, which I assume to mean 'not applicable'.  I also note that the same crossing out appears in the section for signing by a guarantor.  Whilst this is of less significance, I note that such clauses are commonly completed where the lessee is a corporate entity.

2. The first page of the lease does include an Australian company number and an Australian business number.  Ms Stageman acknowledges that these numbers relate to Devenish, but she says she does not know whether those numbers were recorded at the time the lease was executed.

3. I received in evidence from the first defendant, over objection from the plaintiff, a copy of a business names extract.  That business names extract indicates that the business name 'Realty Trend' has been registered to various people.  Prior to 18 May 2006, it was registered to Mr Healy.  Between 1 August 2006 and 1 May 2010, it was registered to Devenish, and after 1 May 2010, it was registered to Ms Stageman.

4. I also acknowledge that one of the letters received by the plaintiff's solicitors from the first defendant's solicitors refers to a search undertaken by the first defendant's solicitors with the Real Estate and Business Agents Supervisory Board.  That letter states that the board had advised that its records showed that the real estate agent carrying on business from the premises had been, at all relevant times, Devenish 1897 Pty Ltd.

5. I take into account those pieces of evidence.  However, they cannot detract from the terms of the lease.  The first defendant's counsel in submissions to me suggested that it was arguable that the lessee was in fact Devenish.  That may well be so, but it is not the test to be applied at this stage and on an application of this nature.  He also suggested that there was sufficient doubt that Ms Stageman was the lessee.  There may well be evidence from which it could be doubted that Ms Stageman was the lessee, but that too is not the question to be addressed at this stage.

6. Whether or not Devenish is the lessee appears to be the critical issue because whether there is a lawful basis for the actions taken by the defendants depends upon who the lessee of the premises is.  This is because the clear inference is that the defendants were relying on a clause in the lease that provided that if the lessee was a corporation and went into liquidation it was lawful for the owner to enter and repossess the premises.  The relevant clause is cl 15.

Injunction - relevant principles

1. In order to obtain an injunction, the plaintiff must show that there is a serious question to be tried, that the plaintiff will suffer injury for which damages will not be adequate compensation unless an injunction is granted, and that the balance of convenience favours the granting of an injunction.  Each of those tests must be satisfied in order to justify the making of an injunction:  Castlemaine Tooheys Ltd v State of South Australia (1986) 161 CLR 148, 153.

2. It is sufficient that the plaintiff shows a sufficient likelihood of success to justify the status quo being preserved until trial.  How strong the probability of success needs to be will depend on the rights asserted by the plaintiff and the practical consequences that might flow from the orders that the plaintiff seeks:  Australian Broadcasting Corporation v O'Neill (2006) 227 CLR 57, 65, 71.

Serious question to be tried

1. The plaintiff submits that the serious questions to be tried are as follows.  Firstly, there has been a forced entry into the premises by the defendants between the evening of 15 and morning of 16 July 2010, and whether that was unlawful and constituted a trespass.  Secondly, whether there was a removal of property from the premises by the defendants which constituted a breach of the lease and also a trespass.  Thirdly, whether there was a retention of the property by the defendants which constitutes the tort of detinue.  Fourthly, whether the second defendant has unlawfully been in possession of the plaintiff's confidential information; and fifthly, whether a sign displayed by the defendants at the premises conveys a representation that is misleading or deceptive and was calculated to damage the real estate business of the plaintiff.

2. In regard to the last issue, the notice that is referred to is that which was posted in the windows of the premises sometime between 15 and 16 July.  It is annexed to the affidavit of Ms Stageman and states in terms:

   Eviction notice:  Be advised that Devenish 1897 Pty Ltd trading as Realty Trend is under external administration and a liquidator has been appointed to wind up the company.  For all inquiries please contact the administrator direct.

   There then appears the name and address of an administrator in Belmont.

3. The plaintiff points out that whatever state of mind the defendants had in regards to Devenish and its ownership of the business name 'Realty Trend', the business name search tendered by the first defendant shows that at least by the time that that notice was posted, the owner of the business name was, it would seem, undoubtedly Ms Stageman.  Accordingly, to post a notice that indicated that Devenish trading as Realty Trend was under external administration, being posted in the window of the premises, was liable to be wrongly interpreted by anyone who read it as being a reference to the business that was operated by Ms Stageman.

4. It is only necessary, of course, to determine whether there is a serious question to be tried, not to finally decide any such question.  There is in this case evidence which strongly indicates that the plaintiff, Ms Stageman, and not Devenish, was the lessee.  I say that because on the face of it, Devenish is not referred to other than by reference to the company number and business number.  Devenish does not appear on the execution clause and there is no reference to it whatsoever in the lease.

5. As opposed to that, Ms Stageman's name does appear, and she has signed the lease apparently in a personal capacity.  The section for signing by a corporate lessee has been struck out, as I have noted.  That being so, there is in my view, a serious question to be tried as to whether the entry and repossession by the first defendant was lawful.

6. If that is the case, then it must follow as a matter of logic that the lawfulness of the taking of possession of the property of the plaintiff during that repossession is also seriously in question.  I also recognise that even if there were grounds for taking possession of the premises, there does not appear to have been any reasonable opportunity afforded to the plaintiff to recover her property held within the premises and to remove it prior to it being removed by the first and second defendants.

7. On the available evidence, the plaintiff occupied the premises prior to 16 July 2010, and enjoyed an exclusive right to occupy those premises. In the absence of any breach of the terms of the lease by the plaintiff, valid notice served by the first defendant and compliance with s 81 of the Property Law Act 1969 (WA), the entry by or on behalf of the first and second defendants on the premises would constitute interference with the plaintiff's right to possession of the premises, in breach of the lease and an actionable trespass: Plenty v Dillon (1991) 171 CLR 635, 647.

8. Ongoing exclusion of the plaintiff from the premises could be a continuing trespass.  That is a matter to be taken into account in determining whether an injunction is appropriate at this stage.

Adequacy of damages

1. The appropriate remedy for the conduct of the defendants in such a case would be an injunction to restrain the continuing breach and trespass and to restore the plaintiff to possession pursuant to the lease.  That is particularly so if damages are not an adequate remedy.  I note in that regard that it has been held that damages will rarely be an adequate remedy for the invasion of proprietary or possessory rights:  Beswicke v Alner [1926] VLR 72, 77.

2. Unlawful removal of property from premises and refusal to deliver property back to a lessee in possession can constitute a trespass to the property:  Wilson v Lombank Ltd [1963] 1 WLR 1294; GWK Ltd v Dunlop Rubber Co Ltd (1926) 42 TLR 376.

3. It is relevant to take into account whether the intention of the first defendant, when unlawfully entering the premises, if that be the case, was to interfere directly with the plaintiff's property and property lawfully in her possession as bailee:  McHale v Watson (1964) 111 CLR 384, 388.

4. The plaintiff here says that the property removed on the evening or morning of 15 - 16 July was property either owned by her or property which was held by her lawfully, either on behalf of clients of her business or on behalf of Devenish.  There seems to be no doubt, at least on the evidence available, that she was indeed in possession of all of that property, and there has been no contest that that possession was lawful.

5. To retain property in these circumstances could constitute a continuing trespass.  Conduct in failing to return property could also amount to detinue:  Halsbury's Laws of Australia, [315‑565], [315‑570].

6. It has been alleged in these proceedings that some of the information that was obtained from the premises was information of a confidential nature.  It seems to be beyond doubt that it was business records of the business that was being conducted from those premises up until 15 July 2010.

7. Injunctive relief will be appropriate in any case involving breach of confidence, either to restrain the initial breach or prevent further breaches:  AG Australia Holdings v Burton (2002) 58 NSWLR 464. In those circumstances, a plaintiff is further entitled to delivery up of any copies or recordings of any information that have been made from those confidential records. That would be necessary in order to preserve the confidential nature of the information.

8. In this case I need to take into account that the injunction being sought is of the nature of a mandatory injunction.  That is because, unlike those situations which arise where a lessee seeks to prevent a landlord from taking possession before eviction has occurred, in this case the plaintiff is seeking to be put back into possession.  Whilst I take that into account, and in that regard acknowledge the principles in relation to mandatory injunctions that are set out in Cash Converters Pty Ltd v Hila Pty Ltd (1993) 9 WAR 471, and also in Automasters Australia Pty Ltd v Bruness Pty Ltd [1999] WASC 39, 72 ‑ 75, it does seem to me that in this case I also need to take into account that the opportunity for the plaintiff to have taken any action to restrain the owner from evicting her was brief indeed, and would appear to have only been between 12 ‑ 15 July, and in circumstances when there was at that time exchanges of correspondence between the respective solicitors.

9. It is submitted in these proceedings that the effect of the repossession and the seizure of the personal property of the plaintiff has been to cause damage to her business, in effect to stop that business being conducted in Toodyay, that it constitutes a continuing trespass because she continues to be excluded from the premises, that it has had effect not only upon the ability to conduct business, but also upon her reputation and the reputation of her business, and that those effects are not likely to be amenable to an award of damages; that is to say that damages would not ultimately be an adequate remedy in this case.  I accept those submissions.

Balance of convenience

1. The question of balance of convenience is a matter that I need to take into account.  In that regard, the court must bear in mind the strength of the plaintiff's case.  It is of course important to recognise that it is not necessary at this stage to make conclusive findings of fact.  Indeed, it is not possible to do so bearing in mind that the defendants have yet to have an opportunity to challenge the plaintiff's evidence or put on evidence of their own, but that is not unusual in applications of this type.

2. I accept that the balance of convenience in this case seems to clearly favour the granting of an injunction.  I say that because if an injunction of the type which is sought by these proceedings is granted, the plaintiff would be restored to the premises and would continue, one assumes, to conduct her business and would be obliged to meet her rent obligations.  I should say in this regard that the evidence available is that the rent has been paid and indeed has been paid for the current month.

3. It would also have the effect that the first defendant would continue to have a tenant in its premises.  I acknowledge in this regard that counsel for the first defendant has suggested that the first defendant would offer an undertaking, if an injunction were not given, not to relet the premises.  That seems to offer scant comfort to the plaintiff in circumstances where she has already paid the rent for the month which we are now in.  It also seems not to the point that, for reasons best known to itself, the first defendant would wish to deny itself the possibility of a paying tenant.  The fact is an injunction which would place in possession a paying tenant would seem not to offer any detriment to the first defendant.

1. To grant an injunction that would put the plaintiff back in possession would return the status quo which existed prior to 15 July 2010, and the plaintiff would in those circumstances be in the position she was in prior to that time.  The first defendant would be unlikely, on the face of it, to suffer loss as a result of that.

2. On the other hand, if the injunction is not granted, the plaintiff will be unable to conduct her Toodyay business.  She deposes that the ability to find alternative premises is limited, if not impossible.  She also deposes that her business would be irreparably damaged by the fact that she would be seen not to return to those premises by the community, and that she would be denied the benefit of the lease which was entered into in December of last year and which has somewhat short of 18 months still to go.  It is also suggested that she would be unable to meet her obligations to her existing customers.

3. In these circumstances, the failure to grant an injunction would seem to have extremely detrimental consequences for the plaintiff.  The balance of convenience, as I say, therefore favours the granting of an injunction.

Conclusion

1. Accordingly, I am satisfied that the tests that I referred to, namely that there is a serious question to be tried, that the plaintiff will suffer injury for which damages will not be adequate and the balance of convenience are satisfied in this case, and that it is appropriate to grant an injunction.

2. Turning then to the orders that have been sought, one of those orders refers to the delivery up of property taken by the first defendant.  That relates to the property, as I understand it, taken from the premises on the evening or morning of 15 and 16 July.  It has been submitted by the first defendant that that property has in fact all been passed to the liquidator of Devenish.  There is no evidence before me as to that, but it would not be appropriate to impose an order that was impossible to comply with.  So in that regard, it would seem to me, appropriate to amend the order by confining it to any property which remains in the custody or control of the first defendant.

3. As regards the orders sought against the second defendant, Mr Marcelli, they are confined to, firstly, an affidavit in regards to what occurred to the property and secondly, the delivery up of any copies or records made of the information obtained from the premises.  Mr Marcelli has indicated today that he has no objection to providing an affidavit.  He has also said that he did not make any copies of records and so he has no objection to an order in those terms either, since he maintains that he has no copies to deliver up.

4. That leaves the question of costs.  The plaintiff has sought costs on an indemnity basis.  I think I need to take into account that Mr Marcelli, who appears today representing himself, has indicated that in regards to costs he would seek, if there is to be any order as to costs, that he have the opportunity of being represented.  In those circumstances, I do not feel it appropriate to make an order of costs today.  Accordingly, the question of costs will be reserved.